After the incredible Increase in pricing over the last few years, this is an incredible time for someone to be purchasing his or her new home. There is an abundance of properties available for sale, sellers have become much more negotiable and mortgage rates are still at a great level.
Before you begin though, you need to take care of several steps prior to beginning your home hunting expedition. The most important step is establishing with a mortgage broker or your bank how much of a mortgage you qualify for and how much you can comfortably afford to pay each month.
When you have discovered what you can safely qualify for, it's very important to get a signed commitment of pre-approval from your banker or broker at this time. If your commitment is just verbal, you could be leaving yourself wide open later. Bank employees change banks, brokers change agencies, and policies get revised. If any of these occur, your verbal commitment could change at the same time.
Some of your mortgage decisions will involve how much down payment you will be putting down on the purchase. If it is directly from your savings or other investments, it will be easier than if you have to sell your current home to acquire the down payment.
If you need to sell your home to come up with the down payment you may wish to consider selling your property first, before putting an offer in place. While sellers are negotiable, very few will agree to a condition of waiting 60 days, or 90 days, or even longer for you to sell your home. To prevent this, most Real Estate contracts include a clause that triggers a shortened period for you to remove your conditions if they receive a second offer. This could put your potential purchase into jeopardy and you could possibly lose a home you have fallen in love with.
You now know your price range; your next decisions are going to be what neighbourhood, and whether it will be a new home, or a used home. While it is important for you to do your homework, this is where the services of a reputable Real Estate agent can be invaluable. They will be able to guide you along and help with each and every step to make the whole process as easy as possible. This can range from providing you information on communities and schools to ensuring all of your interests are protected during both the buying and selling stages.
It's important for you to know as a buyer that you are not responsible for paying your Realtor a commission. Their commission comes from the seller of the home and is part of the agreement made with the seller or their Realtor. If you are selling your home with your Realtor this will be part of the Brokerage Agreement (listing contract formerly), that you will be signing.
While this is not a complete list of steps to take when buying a new home, hopefully it gets you started on the right path. Buying a new home can be both a frightening experience and one of the best occurrences in your life. Good luck and happy home ownership!
Bill Biko
investors.housez.ca investors.housez.ca
Helping people become involved in Alberta Real Estate and generating wealth while they sleep.
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